Clearing and Forwarding Agent

CESTAT, Bangalore Bench

Style Cell

v.

Commissioner of Central Excise, Mangalore

Dr. S.L. PEERAN, JUDICIAL MEMBER

FINAL ORDER NO. 82 OF 2008

APPEAL NO. ST/95 OF 2005

January 25, 2008

Section 65 of Finance Act, 1994 - Clearing and forwarding agent’s services - Whether where assessee had sold goods on behalf of its principal as an agent and its activity involved only selling of goods to purchasers and it was not handing goods as a consignment agent, it would not come come within category of clearing and forwarding agent or as a consignment agent to be liable for service tax - Held, yes [Para 6]

FACTS

The departments demanded the service tax from the assessee on the ground that its activity of purchasing goods from ‘ITC’ and selling them at the price fixed by ‘ITC’ had to be considered to be coming under the category of consignment agent falling under head clearing and forwarding agent’s services.

On appeal:

HELD

The assessee had been covered under sale of Goods Act for the purpose of levy of sales tax. It had sold the goods on behalf of the principal as an agent and its activity involved selling the goods to the purchasers and it was not handling the goods to come within the category of clearing and forwarding agent or as a consignment agent. Therefore, the impugned order was not legal and proper. Therefore, impugned order was to be set aside and the appeal was to be allowed. [Para 6]